Hyatt Reports Fourth Quarter 2017 Results
•Initiates Quarterly Cash Dividend of $0.15 per Share
Hyatt Hotels Corporation ("Hyatt" or the "Company") (H) today
reported fourth quarter 2017 financial results. Net income attributable
to Hyatt was $76 million, or $0.62 per diluted share, in the fourth
quarter of 2017, compared to $41 million, or $0.31 per diluted share, in
the fourth quarter of 2016. Net income in the fourth quarter of 2017
included a $217 million gain from the sale of Avendra, LLC, an equity
method investment, and $110 million of incremental tax attributable to
recent U.S. tax reform. Adjusted net income attributable to Hyatt was
$29 million, or $0.23 per diluted share, in the fourth quarter of 2017,
compared to $39 million, or $0.29 per diluted share, in the fourth
quarter of 2016. Refer to the table on page 4 of the schedules for a
summary of special items impacting Adjusted net income and Adjusted
earnings per share in the three months ended December 31, 2017.
Mark S. Hoplamazian, president and chief executive officer of Hyatt
Hotels Corporation, said, "We had a strong finish to the year,
delivering full-year comparable RevPAR growth of 3.3% and net hotel
rooms growth of 7.0%, fueled by a record-setting 71 new hotels added to
our system in 2017. Double-digit growth in management and franchising
fees more than offset an earnings decline in our owned and leased
segment, which reflected more than $900 million in asset dispositions."
Fourth quarter of 2017 financial results as compared to the fourth
quarter of 2016 are as follows:
Net income increased 87.4% to $76 million.
Adjusted EBITDA increased 4.0% to $179 million, up 3.0% in constant
Comparable systemwide RevPAR increased 3.8%, including an increase of
4.1% at comparable owned and leased hotels. Excluding the benefit from
the timing of the Jewish holiday, comparable systemwide RevPAR
increased 3.2%, and comparable owned and leased hotels RevPAR
Comparable U.S. hotel RevPAR increased 3.0%; full service and select
service hotel RevPAR increased 2.9% and 3.2%, respectively.
Comparable owned and leased hotels operating margin increased 150
basis points to 23.7%.
Adjusted EBITDA margin decreased 20 basis points to 26.7%.
Fiscal year of 2017 financial results as compared to the fiscal year of
2016 are as follows:
Net income increased 22.3% to $249 million.
Adjusted EBITDA increased 3.9% to $816 million, up 4.0% in constant
Comparable systemwide RevPAR increased 3.3%, including an increase of
0.9% at comparable owned and leased hotels.
Comparable U.S. hotel RevPAR increased 2.2%; full service and select
service hotel RevPAR increased 2.1% and 2.4%, respectively.
Comparable owned and leased hotels operating margin decreased 20 basis
points to 24.3%.
Adjusted EBITDA margin decreased 70 basis points to 29.5%.
The Company opened a record 71 hotels during 2017, compared to 59
hotels in 2016.
Net hotel and net rooms growth was 9.8% and 7.0% in 2017,
respectively, compared to growth of 9.6% and 7.3%, respectively, in
As of December 31, 2017, the Companys pipeline consisted of
approximately 330 hotels or approximately 70,000 rooms. This compared
to approximately 305 hotels or approximately 66,000 rooms as of
December 31, 2016.
The Company repurchased 12,186,308 shares of common stock for $723
million in 2017, compared to 5,631,557 shares for $272 million in 2016.
Mr. Hoplamazian continued, "We believe we are well-positioned to execute
our long-term growth strategy of maximizing our core business focused on
high-end travelers, integrating new growth platforms and optimizing
capital deployment. Plans to sell roughly $1.5 billion of real estate by
the end of 2020 are underway. We remain confident that these actions
will support growth in our business and further unlock shareholder
value, as evidenced by our initiation of a quarterly cash dividend as
well as the increase in our share repurchase authorization."
Fourth quarter of 2017 financial results as compared to the fourth
quarter of 2016 are as follows:
Owned and Leased Hotels Segment
Total owned and leased hotels segment Adjusted EBITDA decreased 8.1%
(8.8% in constant currency) including a 34.0% decrease in pro rata share
of unconsolidated hospitality ventures Adjusted EBITDA. The decrease in
total segment Adjusted EBITDA was primarily driven by transaction
activity, partially offset by benefits related to the timing of the
Jewish holiday. Refer to the table on page 19 of the schedules for a
detailed list of portfolio changes and the year-over-year net impact to
fourth quarter owned and leased hotels segment Adjusted EBITDA. Owned
and leased hotels segment revenues decreased 2.5% (3.6% in constant
RevPAR for comparable owned and leased hotels increased 4.1%. Occupancy
increased 120 basis points and ADR increased 2.4%.
The following hotel was added to the portfolio in the fourth quarter:
Hyatt House Irvine / John Wayne Airport (owned, 149 rooms)
The following three hotels were removed from the owned and leased hotels
portfolio as they were sold in the fourth quarter:
Hyatt Regency Scottsdale Resort & Spa at Gainey Ranch (493 rooms),
Royal Palms Resort and Spa (119 rooms) and Hyatt Regency Monterey
Hotel & Spa on Del Monte Golf Course (550 rooms). The hotels continue
to be Hyatt-branded with Hyatt Regency Scottsdale and Royal Palms
operating under long-term management agreements and Hyatt Regency
Monterey operating under a long-term franchise agreement.
Management and Franchise Fees
Total fee revenues increased 12.8% (11.9% in constant currency) to $131
million. Base management fees increased 9.5% to $52 million and
incentive management fees increased 13.9% to $36 million, driven by new
hotels and improved performance at existing hotels. Franchise fees
increased 7.6% to $29 million. Other fee revenues increased 38.9% to $14
million, including $8 million of deferred gains.
Americas Management and Franchising Segment
Americas management and franchising segment Adjusted EBITDA increased
6.5% (6.3% in constant currency). RevPAR for comparable Americas full
service hotels increased 3.3%; occupancy increased 110 basis points and
ADR increased 1.7%. RevPAR for comparable Americas select service hotels
increased 4.5%; occupancy increased 170 basis points and ADR increased
2.1%. Revenue from management, franchise and other fees increased 5.2%
(5.1% in constant currency).
Group rooms revenue at comparable U.S. full service hotels increased
3.4%; room nights increased 0.8% and ADR increased 2.6%. Group demand
was favorably impacted by the timing of the Jewish holiday. Transient
rooms revenue at comparable U.S. full service hotels increased 2.0%;
room nights increased 0.5% and ADR increased 1.5%.
The following 16 hotels were added to the portfolio during the fourth
Park Hyatt St. Kitts, Saint Kitts and Nevis (managed, 126 rooms)
Grand Hyatt Baha Mar, The Bahamas (managed, 1,800 rooms)
Holston House Nashville, The Unbound Collection by Hyatt (franchised,
Spirit Ridge, The Unbound Collection by Hyatt, Canada (franchised, 226
Hyatt Place Ann Arbor (franchised, 142 rooms)
Hyatt Place Athens / Downtown (franchised, 190 rooms)
Hyatt Place Houston-Northwest / Cy-Fair (franchised, 107 rooms)
Hyatt Place Keystone, Indiana (franchised, 103 rooms)
Hyatt Place Knoxville / Downtown (franchised, 165 rooms)
Hyatt Place Long Island City / New York City (franchised, 108 rooms)
Hyatt Place Marlborough / Apex Center, Massachusetts (franchised, 137
Hyatt Place St. George / Convention Center, Utah (franchised, 104
Hyatt House Irvine / John Wayne Airport (owned, 149 rooms)
Hyatt House Jersey City (franchised, 258 rooms)
Hyatt House Raleigh / RDU / Brier Creek (franchised, 130 rooms)
Hyatt House Washington DC / The Wharf (franchised, 237 rooms)
Four hotels were removed from the portfolio during the fourth quarter.
Southeast Asia, Greater China, Australia, South Korea, Japan and
Micronesia (ASPAC) Management and Franchising Segment
ASPAC management and franchising segment Adjusted EBITDA increased 17.9%
(15.7% in constant currency). RevPAR for comparable ASPAC full service
hotels increased 4.3%, driven by strong growth in Greater China and
Southeast Asia. Occupancy increased 180 basis points and ADR increased
1.8%. Revenue from management, franchise and other fees increased 16.7%
(15.0% in constant currency).
The following seven hotels were added to the portfolio during the fourth
Andaz Singapore, Singapore (managed, 342 rooms)
Hyatt Place Bangkok Sukhumvit, Thailand (managed, 222 rooms)
Hyatt Place Shanghai Hongqiao CBD, China (managed, 252 rooms)
Hyatt Place Shanghai New Hongqiao, China (managed, 194 rooms)
Hyatt Place Zhuhai Jinshi, China (managed, 190 rooms)
Hyatt House Shanghai Hongqiao CBD, China (managed, 126 rooms)
Hyatt House Shanghai New Hongqiao, China (managed, 101 rooms)
Europe, Africa, Middle East and Southwest Asia (EAME/SW Asia)
Management and Franchising Segment
EAME/SW Asia management and franchising segment Adjusted EBITDA
increased 36.9% (31.7% in constant currency). RevPAR for comparable
EAME/SW Asia full service hotels increased 3.8%, driven by growth in
most European markets and partially offset by weak performance in the
Middle East. Occupancy increased 200 basis points and ADR increased
0.7%. Revenue from management, franchise and other fees increased 15.8%
(12.4% in constant currency).
The following six hotels were added to the portfolio during the fourth
Hyatt Regency Moscow Petrovsky Park, Russia (managed, 298 rooms)
Hyatt Centric Gran Via Madrid, Spain (managed, 159 rooms)
Hyatt Centric La Rosiere, France (franchised, 69 rooms)
Hyatt Place Hyderabad / Banjara Hills, India (managed, 147 rooms)
Hyatt House Dusseldorf / Andreas Quarter, Germany (franchised, 102
Hyatt House Gebze, Turkey (managed, 158 rooms)
Corporate and Other
Corporate and other Adjusted EBITDA increased 8.6% (consistent in
constant currency). Corporate and other revenues increased 228.9%
(consistent in constant currency), primarily driven by new business
platforms, including Miraval and exhale in the wellness space, while
also driven by increased revenues related to the Companys co-branded
Selling, General, and Administrative Expenses
Selling, general, and administrative expenses increased 30.2%. Adjusted
selling, general, and administrative expenses increased 21.4%,
reflecting increased payroll and related costs, including severance
charges, acquisitions and certain marketing initiatives in 2017. Refer
to the table on page 10 of the schedules for a reconciliation of
selling, general, and administrative expenses to Adjusted selling,
general, and administrative expenses.
OPENINGS AND FUTURE EXPANSION
Twenty-nine hotels (or 6,533 rooms) were added in the fourth quarter of
2017, each of which is listed above. The Companys net rooms were 7.0%
higher in the fourth quarter of 2017, compared to the fourth quarter of
2016. During the 2017 fiscal year, the Company opened a record 71
hotels, representing 13,698 rooms. Six hotels, representing 1,520 rooms,
were removed from the portfolio during the 2017 fiscal year.
As of December 31, 2017, the Company had executed management or
franchise contracts for approximately 330 hotels (approximately 70,000
rooms), compared to the expectation for 315 hotels and 69,000 rooms as
of September 30, 2017. The pipeline of executed contracts represent
important potential entry into several new countries and expansion into
new markets or markets in which Hyatt is under-represented. Refer to the
table on page 18 of the schedules for a breakdown of the pipeline.
DIVIDEND / SHARE REPURCHASE
As part of the Companys commitment to return meaningful capital to
shareholders, the Company is initiating a quarterly cash dividend of
$0.15 per share, representing an annualized dividend of $0.60 per share.
The initial dividend will be payable on March 29, 2018 to Class A and
Class B shareholders on record as of March 22, 2018.
During the 2017 fiscal year, the Company repurchased a record $723
million of shares, consisting of 12,186,308 shares of common stock
(9,096,871 Class A shares and 3,089,437 Class B shares), at a weighted
average price of $59.34 per share. During the fourth quarter of 2017,
the Company repurchased 2,693,579 shares of common stock (1,417,601
Class A shares and 1,275,978 Class B shares) for an aggregate purchase
price of $188 million. The Company ended the fourth quarter with
48,231,149 Class A and 70,753,837 Class B shares issued and outstanding.
From January 1 through February 9, 2018, the Company repurchased 277,760
shares of Class A common stock for an aggregate purchase price of $23
million. This includes a final tranche of Class A shares that settled as
part of a November 2017 accelerated share repurchase program. As of
February 9, 2018, the Company had approximately $861 million remaining
under its share repurchase authorization.
CAPITAL STRATEGY UPDATE
During the fourth quarter, the Company completed the following
Sold Hyatt Regency Scottsdale Resort & Spa at Gainey Ranch (493 rooms)
and Royal Palms Resort and Spa in Phoenix, Arizona (119 rooms) for
approximately $305 million. The hotels continue to be Hyatt-branded
under long-term management agreements.
Sold Hyatt Regency Monterey Hotel & Spa on Del Monte Golf Course (550
rooms) for approximately $58 million. The sale was part of the
Companys ongoing asset recycling strategy. The hotel continues to be
Hyatt-branded under a long-term franchise agreement.
The Company continues to execute plans to sell approximately $1.5
billion of real estate by the end of 2020 as part of its long-term
growth strategy. The disposition of Hyatt Regency Scottsdale Resort &
Spa at Gainey Ranch and Royal Palms Resort and Spa in the fourth quarter
of 2017 reflects progress towards this goal. Additional properties are
being actively marketed for sale.
BALANCE SHEET / OTHER ITEMS
As of December 31, 2017, the Company reported the following:
Total debt of $1.5 billion.
Pro rata share of unconsolidated hospitality venture debt of $580
million, substantially all of which is non-recourse to Hyatt and a
portion of which Hyatt guarantees pursuant to separate agreements.
Cash and cash equivalents, including investments in highly-rated money
market funds and similar investments, of $503 million, short-term
investments of $49 million and restricted cash of $234 million.
Undrawn borrowing availability of $1.5 billion under its revolving
The Company is providing the following information for the 2018 fiscal
Net income is expected to be approximately $176 million to $215
Adjusted EBITDA is expected to be approximately $805 million to $825
million. These estimates also include a favorable impact from foreign
currency of approximately $0 (low end of the forecast) to $5 million
(high end of the forecast). Refer to the table on page 3 of the
schedules for a reconciliation of Net Income to Adjusted EBITDA.
Comparable systemwide RevPAR is expected to increase approximately 1%
to 3%, as compared to fiscal year 2017.
Adjusted selling, general, and administrative expenses are expected to
be approximately $300 million. This excludes approximately $35 million
to $36 million of stock-based compensation expense and any potential
expenses related to benefit programs funded through rabbi trusts.
Capital expenditures are expected to be approximately $350 million.
Depreciation and amortization expense is expected to be approximately
$367 million to $371 million.
Interest expense is expected to be approximately $75 million to $76
Other income (loss), net is expected to be negatively impacted by
approximately $65 million to $75 million related to performance
guarantee expense for the four managed hotels in France.
The effective tax rate is expected to be approximately 27% to 31%,
reflecting estimated impacts from recent U.S. tax reform.
The Company expects to grow units, on a net rooms basis, by
approximately 6.0% to 6.5%, reflecting approximately 60 new hotel
The Company expects to return at least $300 million to shareholders
through a combination of cash dividends on its common stock and share
The above does not reflect anticipated changes resulting from the
adoption of the new revenue recognition standard in 2018. The Company is
in the process of finalizing the adoption impact and restatement of
prior year results. As previously disclosed, the most material non-cash
impact to Adjusted EBITDA relates to the change in accounting for
deferred gains which would result in a reduction of $25 million in 2017
and an anticipated reduction of approximately $31 million in 2018.
The Company plans to update its 2018 Outlook in connection with its
first quarter earnings release to reflect the impact of the new revenue
The Companys outlook is based on a number of assumptions that are
subject to change and many of which are outside the control of the
Company. If actual results vary from these assumptions, the Companys
expectations may change. There can be no assurance that Hyatt will
achieve these results.
CONFERENCE CALL INFORMATION
The Company will hold an extended investor conference call tomorrow,
February 15, 2018, at 10:30 a.m. CT. Participants may listen to a
simultaneous webcast of the conference call, which may be accessed
through the Companys website at investors.hyatt.com, or by dialing
647.689.4468 or (toll free) 833.238.7946, passcode #6582455,
approximately 10 minutes before the scheduled start time. Additionally,
investors may access a presentation that will be available on Hyatts
website at investors.hyatt.com and filed on Form 8-K on February 15,
2018, prior to the call.
For those unable to listen to the live broadcast, a replay will be
available from 1:30 p.m. CT on February 15, 2018 through February 16,
2018 at midnight by dialing 416.621.4642, passcode #6582455. An archive
of the webcast will be available on the Companys website for 90 days.
AVAILABILITY OF INFORMATION ON HYATTS WEBSITE
Investors and others should note that Hyatt routinely announces material
information to investors and the marketplace using U.S. Securities and
Exchange Commission (SEC) filings, press releases, public conference
calls, webcasts and the Hyatt Investor Relations website. While not all
of the information that the Company posts to the Hyatt Investor
Relations website is of a material nature, some information could be
deemed to be material. Accordingly, the Company encourages investors,
the media and others interested in Hyatt to review the information that
it shares at the Investor Relations link located at the bottom of the
page on hyatt.com. Users may automatically receive email alerts and
other information about the Company when enrolling an email address by
visiting "Sign up for Email Alerts" in the "Investor Resources" section
of Hyatts website at investors.hyatt.com.
Adjusted Earnings Before Interest Expense, Taxes,
Depreciation and Amortization ("Adjusted EBITDA") and EBITDA
We use the terms Adjusted EBITDA and EBITDA throughout this earnings
release. Adjusted EBITDA and EBITDA, as the Company defines them, are
non-GAAP measures. We define Adjusted EBITDA as net income attributable
to Hyatt Hotels Corporation plus its pro rata share of unconsolidated
hospitality ventures Adjusted EBITDA based on its ownership percentage
of each venture, adjusted to exclude the following items:
provision for income taxes;
depreciation and amortization;
equity earnings (losses) from unconsolidated hospitality ventures;
stock-based compensation expense;
gains (losses) on sales of real estate; and
other income (loss), net.
We calculate consolidated Adjusted EBITDA by adding the Adjusted EBITDA
of each of our reportable segments and eliminations to corporate and
other Adjusted EBITDA. Our board of directors and executive management
team focus on Adjusted EBITDA as a key performance and compensation
measure both on a segment and on a consolidated basis. Adjusted EBITDA
assists us in comparing our performance over various reporting periods
on a consistent basis because it removes from our operating results the
impact of items that do not reflect our core operations both on a
segment and on a consolidated basis. Our president and chief executive
officer, who is the chief operating decision maker, also evaluates the
performance of each of our reportable segments and determines how to
allocate resources to those segments, in significant part, by assessing
the Adjusted EBITDA of each segment. In addition, the compensation
committee of our board of directors determines the annual variable
compensation for certain members of our management based in part on
consolidated Adjusted EBITDA, segment Adjusted EBITDA or some
combination of both. We believe Adjusted EBITDA is useful to investors
because it provides investors the same information that the Company uses
internally for purposes of assessing operating performance and making
Adjusted EBITDA and EBITDA are not substitutes for net income
attributable to Hyatt Hotels Corporation, net income, or any other
measure prescribed by accounting principles generally accepted in the
United States of America (GAAP). There are limitations to using non-GAAP
measures such as Adjusted EBITDA and EBITDA. Although we believe that
Adjusted EBITDA can make an evaluation of our operating performance more
consistent because it removes items that do not reflect our core
operations, other companies in our industry may define Adjusted EBITDA
differently than we do. As a result, it may be difficult to use Adjusted
EBITDA or similarly named non-GAAP measures that other companies may use
to compare the performance of those companies to our performance.
Because of these limitations, Adjusted EBITDA should not be considered
as a measure of the income generated by our business. Our management
addresses these limitations by reference to its GAAP results and using
Adjusted EBITDA supplementally.
Adjusted EBITDA Margin
We define Adjusted EBITDA margin as Adjusted EBITDA divided by total
revenues, net of other revenues from managed and franchised properties.
Other revenues from managed and franchised properties reflect reimbursed
costs incurred on behalf of managed and franchised hotel property
owners. We believe Adjusted EBITDA margin is useful to investors because
it provides investors the same information that the Company uses
internally for purposes of assessing operating performance.
Adjusted Net Income
Adjusted net income, as we definite it, is a non-GAAP measure. We define
Adjusted net income as net income attributable to Hyatt Hotels
Corporation excluding special items, which are those items deemed not to
be reflective of ongoing operations. We believe Adjusted net income
provides meaningful comparisons of ongoing operating results.
Adjusted Selling, General, and Administrative
Adjusted SG&A expenses, as we define it, is a non-GAAP measure. Adjusted
SG&A expenses exclude the impact of expenses related to benefit programs
funded through rabbi trusts and stock-based compensation expense.
Adjusted SG&A expenses assist us in comparing our performance over
various reporting periods on a consistent basis since it removes from
our operating results the impact of items that do not reflect our core
operations, both on a segment and consolidated basis.
Comparable Owned and Leased Hotels Operating Margin
We define comparable owned and leased hotels operating margin as the
difference between comparable owned and leased hotels revenues and
comparable owned and leased hotels expenses. Comparable owned and leased
hotels revenues is calculated by removing non-comparable hotels revenues
from owned and leased hotels revenues as reported in our consolidated
statements of income. Comparable owned and leased hotels expenses is
calculated by removing both non-comparable owned and leased hotels
expenses and the impact of expenses funded through rabbi trusts from
owned and leased hotels expenses as reported in our consolidated
statements of income. We believe comparable owned and leased hotels
operating margin is useful to investors because it provides investors
the same information that the Company uses internally for purposes of
assessing operating performance.
"Comparable systemwide hotels" represents all properties we manage or
franchise (including owned and leased properties) and that are operated
for the entirety of the periods being compared and that have not
sustained substantial damage, business interruption, or undergone large
scale renovations during the periods being compared or for which
comparable results are not available. We may use variations of
comparable systemwide hotels to specifically refer to comparable
systemwide Americas full service or select service hotels for those
properties that we manage or franchise within the Americas management
and franchising segment, comparable systemwide ASPAC full service hotels
for those properties that we manage or franchise within the ASPAC
management and franchising segment, or comparable systemwide EAME/SW
Asia full service or select service hotels for those properties that we
manage or franchise within the EAME/SW Asia management and franchising
segment. "Comparable operated hotels" is defined the same as "comparable
systemwide hotels" with the exception that it is limited to only those
hotels we manage or operate and excludes hotels we franchise.
"Comparable owned and leased hotels" represents all properties we own or
lease and that are operated and consolidated for the entirety of the
periods being compared and have not sustained substantial damage,
business interruption, or undergone large scale renovations during the
periods being compared or for which comparable results are not
available. Comparable systemwide hotels and comparable owned and leased
hotels are commonly used as a basis of measurement in our industry.
"Non-comparable systemwide hotels" or "non-comparable owned and leased
hotels" represent all hotels that do not meet the respective definition
of "comparable" as defined above.
Constant Dollar Currency
We report the results of our operations both on an as reported basis, as
well as on a constant dollar basis. Constant dollar currency, which is a
non-GAAP measure, excludes the effects of movements in foreign currency
exchange rates between comparative periods. We believe constant dollar
analysis provides valuable information regarding our results as it
removes currency fluctuations from our operating results. We calculate
constant dollar currency by restating prior-period local currency
financial results at the current periods exchange rates. These adjusted
amounts are then compared to our current period reported amounts to
provide operationally driven variances in our results.
Revenue per Available Room (RevPAR)
RevPAR is the product of the average daily rate (ADR) and the average
daily occupancy percentage. RevPAR does not include non-room revenues,
which consist of ancillary revenues generated by a hotel property, such
as food and beverage, parking, and other guest service revenues. Our
management uses RevPAR to identify trend information with respect to
room revenues from comparable properties and to evaluate hotel
performance on a regional and segment basis. RevPAR is a commonly used
performance measure in our industry. RevPAR changes driven predominantly
by changes in occupancy have different implications for overall revenue
levels and incremental profitability than do changes driven
predominantly by changes in average room rates. For example, increases
in occupancy at a hotel would lead to increases in room revenues and
additional variable operating costs (including housekeeping services,
utilities, and room amenity costs), and could also result in increased
ancillary revenues (including food and beverage). In contrast, changes
in average room rates typically have a greater impact on margins and
profitability as there is no substantial effect on variable costs.
Average Daily Rate (ADR)
ADR represents hotel room revenues, divided by the total number of rooms
sold in a given period. ADR measures average room price attained by a
hotel and ADR trends provide useful information concerning the pricing
environment and the nature of the customer base of a hotel or group of
hotels. ADR is a commonly used performance measure in our industry, and
we use ADR to assess the pricing levels we are able to generate by
customer group, as changes in rates have a different effect on overall
revenues and incremental profitability than changes in occupancy, as
Occupancy represents the total number of rooms sold divided by the total
number of rooms available at a hotel or group of hotels. Occupancy
measures the utilization of a hotels available capacity. We use
occupancy to gauge demand at a specific hotel or group of hotels in a
given period. Occupancy levels also help us determine achievable ADR
levels as demand for hotel rooms increases or decreases.
Pipeline reflects fully executed management and franchise agreements.
Forward-Looking Statements in this press release, which are not
historical facts, are forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements
include statements about our plans, strategies, outlook, occupancy, ADR
and growth trends, market share, the number of properties we expect to
open in the future, the amount by which the Company intends to reduce
its real estate asset base and the anticipated timeframe for such asset
dispositions, our expected adjusted SG&A expense, our estimated
comparable systemwide RevPAR growth, our estimated Adjusted EBITDA
growth, maintenance and enhancement to existing properties capital
expenditures, investments in new properties capital expenditures,
depreciation and amortization expense and interest expense estimates,
financial performance, prospects or future events and involve known and
unknown risks that are difficult to predict. As a result, our actual
results, performance or achievements may differ materially from those
expressed or implied by these forward-looking statements. In some cases,
you can identify forward-looking statements by the use of words such as
"may," "could," "expect," "intend," "plan," "seek," "anticipate,"
"believe," "estimate," "predict," "potential," "continue," "likely,"
"will," "would" and variations of these terms and similar expressions,
or the negative of these terms or similar expressions. Such
forward-looking statements are necessarily based upon estimates and
assumptions that, while considered reasonable by us and our management,
are inherently uncertain. Factors that may cause actual results to
differ materially from current expectations include, among others,
general economic uncertainty in key global markets and a worsening of
global economic conditions or low levels of economic growth; the rate
and the pace of economic recovery following economic downturns; levels
of spending in business and leisure segments as well as consumer
confidence; declines in occupancy and average daily rate; limited
visibility with respect to future bookings; loss of key personnel;
hostilities, or fear of hostilities, including future terrorist attacks,
that affect travel; travel-related accidents; natural or man-made
disasters such as earthquakes, tsunamis, tornadoes, hurricanes, floods,
wildfires, oil spills, nuclear incidents, and global outbreaks of
pandemics or contagious diseases or fear of such outbreaks; our ability
to successfully achieve certain levels of operating profits at hotels
that have performance guarantees in favor of our third-party owners; the
impact of hotel renovations and redevelopments; risks associated with
our capital allocation plans and common stock repurchase program and
other forms of shareholder capital return, including the risk that our
common stock repurchase program could increase volatility and fail to
enhance stockholder value; our intention to pay a quarterly cash
dividend and the amounts thereof, if any; the seasonal and cyclical
nature of the real estate and hospitality businesses; changes in
distribution arrangements, such as through internet travel
intermediaries; changes in the tastes and preferences of our customers;
relationships with colleagues and labor unions and changes in labor
laws; the financial condition of, and our relationships with,
third-party property owners, franchisees, and hospitality venture
partners; the possible inability of third-party owners, franchisees, or
development partners to access capital necessary to fund current
operations or implement our plans for growth; risks associated with
potential acquisitions and dispositions and the introduction of new
brand concepts; the timing of acquisitions and dispositions; failure to
successfully complete proposed transactions (including the failure to
satisfy closing conditions or obtain required approvals); our ability to
successfully execute on our strategy to reduce our real estate asset
base within targeted timeframes and at expected values; declines in the
value of our real estate assets; unforeseen terminations of our
management or franchise agreements; changes in federal, state, local, or
foreign tax law; the impact of changes in the tax code as a result of
recent U.S. federal income tax reform and uncertainty as to how some of
those changes may be applied; increases in interest rates and operating
costs; foreign exchange rate fluctuations or currency restructurings;
lack of acceptance of new brands or innovation; general volatility of
the capital markets and our ability to access such markets; changes in
the competitive environment in our industry, including as a result of
industry consolidation, and the markets where we operate; our ability to
successfully grow the World of Hyatt loyalty program and the level of
acceptance of the program by our guests; cyber incidents and information
technology failures; outcomes of legal or administrative proceedings;
violations of regulations or laws related to our franchising business;
and other risks discussed in the Companys filings with the SEC,
including our annual report on Form 10-K, which filings are available
from the SEC. We caution you not to place undue reliance on any
forward-looking statements, which are made only as of the date of this
press release. We do not undertake or assume any obligation to update
publicly any of these forward-looking statements to reflect actual
results, new information or future events, changes in assumptions or
changes in other factors affecting forward-looking statements, except to
the extent required by applicable law. If we update one or more
forward-looking statements, no inference should be drawn that we will
make additional updates with respect to those or other forward-looking
About Hyatt Hotels Corporation
Hyatt Hotels Corporation, headquartered in Chicago, is a leading global
hospitality company with a portfolio of 14 premier brands. As
of December 31, 2017, the Companys portfolio included more than 700
properties in more than 50 countries across six continents. The
Companys purpose to care for people so they can be their best informs
its business decisions and growth strategy and is intended to attract
and retain top colleagues, build relationships with guests and create
value for shareholders. The Companys subsidiaries develop, own,
operate, manage, franchise, license or provide services to hotels,
resorts, branded residences, vacation ownership properties, and fitness
and spa locations, including under the Park Hyatt(R), Miraval(R),
Grand Hyatt(R), Hyatt Regency(R), Hyatt(R), Andaz(R), Hyatt Centric(R), The
Unbound Collection by Hyatt(R), Hyatt Place(R), Hyatt
House(R),Hyatt Ziva(TM),Hyatt Zilara(TM), Hyatt Residence Club(R) and
exhale(R) brand names. For more information, please visit www.hyatt.com.
The financial section of this release, including a reconciliation of the
Companys presented non-GAAP measures to the most directly comparable
GAAP measures, is provided on the Companys website at
Note: All RevPAR and ADR percentage changes are in constant dollars.
This release includes references to non-GAAP financial measures. Refer
to the definitions of the non-GAAP measures presented beginning on page
9 and non-GAAP reconciliations included in the schedules.
View source version on businesswire.com: http://www.businesswire.com/news/home/20180214006322/en/
SOURCE: Hyatt Hotels Corporation
Amanda Bryant, 312.780.5539
Stephanie Lerdall, 312.780.5399